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Oct. 26, 2015, 1:27 PM
- Priceline (NASDAQ:PCLN) is up strongly following news Chinese online travel leader Ctrip (CTRP +21.1%), in which Priceline has an 11.6% stake, announced it's acquiring Baidu's stake in top rival Qunar (QUNR +15.9%) in exchange for shares.
- Expedia (NASDAQ:EXPE), which formed an alliance with Ctrip earlier this year as part of a deal to unload its 62.4% stake in struggling Ctrip/Qunar rival eLong, is also doing well.
- The deal leaves Ctrip owning 45% of Qunar's voting interests, and Baidu owning 25% of Ctrip's voting interests. It brings together China's two biggest online travel firms, and could lead each company to pare back the aggressive promotions and heavy marketing spend it has supported in the name of taking share from the other.
- HSBC's Chi Tsang: "Essentially it’s a merger between the two companies. If you look at the travel market, it’s such an obvious way to drive synergy through consolidation.” As part of the deal, Ctrip has won seats on Qunar's board, and Baidu seats on Ctrip's board.
- At current levels, Priceline's 17.5M-share stake in Ctrip is worth $1.58B. Expedia reports on Thursday afternoon, and Priceline on the morning of Nov. 9.
Oct. 14, 2015, 9:42 AM
- Certain Priceline (PCLN +0.2%) travel brands will support TripAdvisor's (NASDAQ:TRIP) Instant Booking solution, which allows users to make bookings without leaving TripAdvisor's site/apps.
- Development work has already begun to integrate Priceline hotel properties with Instant Booking, which will be supported by Priceline's Booking.com unit (dominant in Europe). The Priceline.com and Agoda.com brands are "likely" to support Instant Booking in time.
- Expedia (NASDAQ:EXPE) has sold off on the news. Morgan Stanley views the deal as a negative for Expedia, noting it gets 9% of its business via TripAdvisor.
- 235K properties are currently available via Instant Booking; a deal with Marriott was struck in June. Priceline (along with Expedia) had previously boycotted Instant Booking even as it supported similar features on other apps, a move seen as highlighting the tension that existed between the platforms.
- Update (12:23PM ET): Regarding Priceline's prior stance towards Instant Booking, a Priceline VP tells Seeking Alpha the company had never said it would "never" support Instant Booking, unlike Expedia. Meanwhile, RBC's Mark Mahaney calls the deal a "big win for TRIP, a small positive for PCLN and a slight negative for EXPE."
Sep. 17, 2015, 10:33 AM
- With the DOJ having given its blessing to the deal yesterday afternoon, Expedia (EXPE +2.9%) has closed its $1.6B ($12/share) acquisition of Orbitz (OWW). The latter's shares have been delisted, while the former's are rallying for the second day in a row.
- Expedia and Orbitz both jumped shortly before the close yesterday after Bloomberg reported U.S. regulators were set to approve the tie-up. The DOJ confirmed the report after the close, declaring it has "concluded that the acquisition is unlikely to harm competition and consumers."
Sep. 16, 2015, 3:59 PM
- Bloomberg reports U.S. regulators are set to approve Expedia's (EXPE +5.1%) $1.6B purchase of smaller rival Orbitz (OWW +6.4%). Shares of both companies have shot higher in response.
- The DOJ has been closely vetting the deal, which has sparked complaints among travel industry firms about the post-merger company's dominant U.S. online travel share and potential pricing/bargaining power.
- Update (4:26PM ET): The DOJ has released a statement confirming it won't challenge the Expedia/Orbitz deal. "The Antitrust Division investigated the concerns that have been expressed about this transaction. We took those concerns seriously and factored into our analysis all of the information provided by third parties. At the end of this process, however, we concluded that the acquisition is unlikely to harm competition and consumers."
Sep. 2, 2015, 5:47 PM
- Expedia (NASDAQ:EXPE) has renewed its deal to provide American Airlines (NASDAQ:AAL) and U.S. Airways bookings on the Expedia, Travelocity, and Hotwire sites/apps. The deal has also been expanded to allow the Expedia Affiliate Network (EAN - provides hotel listings on 3rd-party sites) to provide content for AA.com, and for Expedia, Travelocity, and Hotwire to provide paid seating options for American flights.
- Expedia's air ticket sales rose 26% Y/Y in Q2 (20% on an organic basis). Revenue/ticket fell 10%.
Aug. 25, 2015, 5:35 PM
- investors should stick with "market darlings" - the 25 stocks that had performed the best during the six months before a market pullback - according to the analyst team at RBC.
- The firm notes that although many recent winners are leading the market lower, the extent of the underperformance is just 1%; it also says investing in the group following sharp market pullbacks is a winning strategy over the ensuing week, month and six months.
- RBC's 25 market darlings are AET, ALTR, AMZN, AIZ, CVC, CI, CAG, EA, EQIX, EXPE, GME, GOOGL, HAS, HCA, MNST, NFLX, NKE, PRGO, REGN, SBUX, TSO, TWC, TSS, UA, UHS
Aug. 6, 2015, 8:38 AM
- The American Hotel & Lodging Association is urging federal regulators to block the merger between Expedia (NASDAQ:EXPE) and Orbitz Worldwide (NYSE:OWW).
- The hotel industry is leaning on analysis indicating an Expedia-Orbitz combination would lead to a 75% market share for online travel agent bookings.
- The higher market share could leave hotel operators with less leverage in what's already an uneasy partnership with online travel sites.
Jul. 31, 2015, 1:25 PM
- Expedia (NASDAQ:EXPE) has surged to fresh highs after beating Q2 EPS estimates (and posting in-line revenue) on the back of a 20% Y/Y increase in gross bookings to $15.1B. Bookings growth was slightly better than Q1's 19%, and better than feared given forex headwinds - a strong dollar respectively had 8% and 10% impacts on bookings and revenue growth.
- On the earnings call (transcript), CFO Mark Okerstrom reiterated full-year guidance for 10%-15% adjusted EBITDA growth (exc. the recently-divested eLong). "Though Q2 came in a bit better than expected, we plan to put that upside back into the business mostly in Q3 to drive continued growth."
- CEO Dara Khosrowshahi noted the core Expedia and Hotels.com platforms continued seeing strong growth, as did Travelocity. He also suggested Expedia could follow up its acquisitions of Travelocity and (pending DOJ approval) Orbitz by acquiring assets in overseas markets, where Priceline (NASDAQ:PCLN) and its Booking.com platform loom large. "[F]or the time being, we've got plenty on our plates ... We want our revenue outside the U.S. to be bigger than our revenue in the U.S."
- U.S. bookings rose 18% Y/Y in Q2 to $9.3B, and international bookings (pressured by forex) 25% to $5.8B. Hotel room nights rose 35% (28% organic) to 50.6M, while revenue/night fell 16%. Air tickets sold rose 26% (20% organic), and revenue/ticket fell 10%. Sales/marketing spend rose 19% Y/Y to $885.5M, but tech/content and cost of revenue growth was more moderate.
- Priceline is following Expedia higher ahead of its Aug. 5 Q2 report.
- Expedia's Q2 results, PR
Jul. 31, 2015, 9:19 AM
Jul. 30, 2015, 4:16 PM
- Expedia (NASDAQ:EXPE): Q2 EPS of $0.89 beats by $0.05.
- Revenue of $1.66B (+11.4% Y/Y) in-line.
- Shares +6.85%.
Jul. 30, 2015, 2:44 PM
- The NY Post reports the DOJ is expected to sign off on Expedia's (EXPE +0.8%) $1.6B acquisition of Orbitz (NYSE:OWW). Official approval could reportedly arrive by the end of August.
- The DOJ has been closely vetting the deal on account of Expedia/Orbitz's combined U.S. online travel share. Even after today's gain, Orbitz trades 5.5% below Expedia's $12/share buyout price.
- Expedia reports after the close. Orbitz reports on Aug. 6.
Jul. 29, 2015, 5:35 PM
- AIV, AMCC, AMGN, ATEN, AUY, AVD, AXTI, BAS, BCOR, BCOV, BRCM, BVN, CALD, CATM, CLW, CMLS, COHR, COLM, CPSI, CPT, CRAY, CTRL, CXP, DCT, DECK, DGI, DLR, DTLK, EA, EEP, EGO, EIX, ELLI, ES, ESS, EVHC, EXPE, FE, FEIC, FEYE, FLR, FLS, FR, FRGI, GB, GMED, HBI, HK, HME, HTCH, IM, IMMR, INT, ISBC, KAMN, KLAC, LEG, LNKD, LRE, LSCC, MOH, MTD, MTSN, MWA, MXWL, NGVC, NR, NSR, OLN, OMCL, OUTR, PCCC, PDFS, PKI, PODD, PTCT, PXLW, QLGC, QTM, RGC, RMD, RNG, ROVI, SAM, SB, SGEN, SKYW, SPF, SPN, SYA, SYNA, SZYM, TCO, TEP, TMST, TNAV, TNDM, TPX, TSYS, TXTR, UHS, VCRA, VVUS, WAGE, WBMD, WU, WWWW, YRCW, ZLTQ
Jun. 30, 2015, 11:47 AM
- Piper's Michael Olson reports checks for online travel trends through May point to a strong Q2 for the industry.
- Priceline (PCLN +2.8%), Expedia (EXPE +2%), Travelzoo (TZOO +3%), HomeAway (AWAY +1.6%), and TripAdvisor (TRIP +0.9%) are outperforming to varying degrees amid a 0.5% gain for the Nasdaq. Aside from Expedia, the group has been pressured by a mixture of forex and company-specific concerns. Piper has a neutral rating on Expedia due to valuation concerns, and Overweight ratings on Priceline, TripAdvisor, and HomeAway.
- Separately, Expedia has named worldwide engineering SVP Aman Bhutani the president of the Brand Expedia Group, which covers Expedia.com, Travelocity, Wotif, and Expedia's JV with AirAsia - CEO Dara Khosrowshahi has been handling the job for over 3 years. GeekWire notes Bhutani has a strong reputation within the company for making data-driven tech decisions and experimenting with product changes.
- Previously: Deutsche downgrades Priceline, cites Airbnb
- Previously: Macquarie: HomeAway is cheap if Airbnb is worth $24B
Jun. 22, 2015, 7:49 AM
Jun. 10, 2015, 2:57 PM
- Cowen's Kevin Kopelman, hiking his Expedia (NASDAQ:EXPE) target by $12 to $130 and reiterating an Outperform: "ELong was on track to lose $100 million (this year), dragging down Expedia earnings per share by about 20% ... The sale of eLong removes a major overhang and allows Expedia's core ... earnings to be more fully appreciated in consolidated metrics, although Trivago (another travel site owned by Expedia) continues to be underappreciated due to a lack of earnings."
- Kopelman adds he left meetings with CFO Mark Okerstrom with more confidence in Expedia's growth trajectory. He highlights Expedia's 27% Y/Y Q1 organic hotel room night growth, and expects hotel take rates (-10% Y/Y in Q1) to stabilize. "We believe Expedia is well positioned to continue gaining market share of the hotel booking industry, given its strong portfolio of global brands and competitive technology platform and hotel network."
- In April, Kopelman hiked his Expedia target by $25 to $115, while arguing the company's P/E (then at 27) was misleading on account of the eLong impact and other factors. Shares currently go for 21.6x a 2016 EPS consensus of $5.01.
Jun. 9, 2015, 7:23 AM
- Lufthansa (OTCPK:DLAKF, OTCQX:DLAKY) is taking the dramatic move to charge passengers an extra fee for booking travel through third-party sites.
- Though many airlines are reducing the number of flight options they show on travel sites, Lufthansa is one of the first major carriers to charge for booking outside its network.
- The fee from the German airline for outside bookings will begin in September and average $18 per ticket.
- The trend could pick up warn some industry watchers.
- “Consumers are going to go to the price-comparison sites and thinking they’re comparing prices, but they’re not,” said Yale professor Fiona Scott Morton.
- Related stocks: EXPE, PCLN, OWW, TZOO, TRIP.
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